CME: August crude oil prices waffled between gains and losses throughout the initial morning hours, amid uncertainty ahead of the EU summit and slowing global growth prospects. The outside market tone provided a modest drag for the crude oil, with global equity markets weaker and slight gains in the US dollar. Additionally, slowing growth concerns have offset concerns that North Sea supplies have come under added strain from an oil worker strike in Norway. August crude oil prices climbed to a new four day high in response to yesterday's EIA data that showed an inventory decline of 133,000 barrels last week. EIA crude stocks are 27.697 million barrels above year ago levels and 41.847 million barrels above the five year average. Crude oil imports for the week stood at 9.118 million barrels per day compared to 9.445 million barrels the previous week. The refinery operating rate was up 0.7% to 92.6%, which compares to 88.1% last year and the five year average of 88.55%.
COT: Crude oil was slightly lower overnight as it consolidates around the 62% retracement level of the 2009-2012 rally crossing at 80.33. Stochastics and the RSI are oversold and are turning neutral to bullish hinting that a short term low might be in or is near. Closes above the 20 day moving average crossing at 82.56 are needed to confirm that a short term low has been posted. If August extends this year's decline, the 75% retracement level of the 2009-2011 rally crossing at 73.28 is the next downside target. First resistance is the 20 day moving average crossing at 82.56. Second resistance is the reaction high crossing at 87.32. First support is last Friday's low crossing at 77.56. Second support is the 75% retracement level of the 2009-2011 rally crossing at 73.28.
In other crude oil trading news.....
Venezuela wants OPEC to set an oil price band of $80 to $120 a barrel to stem crude's recent tumble, seeking to revive a policy the cartel scrapped seven years ago.
France is considering a one off tax on the oil sector before the end of 2012 that would raise around 500 million euros ($623.55 million), helping depleted French coffers but hurting its struggling refining industry.
Brazil's state led oil company Petrobras said on Wednesday that May output rose 1.9 percent to an average of 2.60 million barrels a day of oil and natural gas equivalent (boepd) as offshore fields in Brazil restarted after maintenance shutdowns.
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Thursday, June 28, 2012
Wednesday, June 27, 2012
Commodities Get a Boost From New "It Isn't That Bad" Data in the U.S.
Natural gas closed higher on Wednesday as it extended this month's rally. The low range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term. If July extends this month's rally, February's high crossing at 3.104 is the next upside target. Multiple closes below the 20 day moving average crossing at 2.446 are needed to confirm that a short term top has been posted. First resistance is today's high crossing at 2.946. Second resistance is February's high crossing at 3.104. First support is the 10 day moving average crossing at 2.610. Second support is the 20 day moving average crossing at 2.466.
Gold closed higher on Wednesday and the high range close sets the stage for a steady to higher opening when Thursday's night session begins trading. Stochastics and the RSI are neutral to bearish signaling that sideways to lower prices are possible near term. If August extends last week's decline, May's low crossing at 1529.30 is the next downside target. Closes above the 20 day moving average crossing at 1602.30 are needed to temper the bearish outlook. First resistance is the 20 day moving average crossing at 1602.30. Second resistance is reaction high crossing at 1642.40. First support is the reaction low crossing at 1556.40. Second support is May's low crossing at 1529.30.
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SABIC and ExxonMobil to Proceed with Specialty Elastomers Project at Al-Jubail
The facility will be integrated with the existing Jubail complex and is expected to be completed in 2015. The companies have approved the next stage of project development, engineering, procurement and construction (EPC).
The facility will have the capacity to produce up to 400,000 tonnes per year of rubber. Including halobutyl, styrene butadiene, polybutadiene, and ethylene propylene diene monomer (EPDM) rubbers, thermoplastic specialty polymers, and carbon black to serve local markets, the Middle East and Asia. Kemya has awarded the EPC contract for the elastomers facility to Technip, Tecnicas Reunidas and Daelim.
Kemya is a 50-50 joint venture between SABIC and Exxon Chemical Arabia Inc., an affiliate of ExxonMobil Chemical Company. The two companies have collaborated closely since 1980 when they established the joint venture, which produces polyethylene, ethylene, and propylene. The new synthetic rubber project represents a significant broadening of Kemya’s product portfolio.
Find out more about this venture at ExxonMobils Newsroom.
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National Oilwell Varco Completes Wilson Acquisition
National Oilwell Varco, Inc. (NYSE:NOV) announced the closing of its previously announced acquisition of Wilson distribution business segment from Schlumberger Limited (NYSE:SLB). Wilson is a leading distributor of pipe, valves and fittings as well as mill, tool and safety products and services.
Pete Miller, Chairman, President and CEO of National Oilwell Varco, stated “We are happy to welcome Wilson’s employees to the National Oilwell Varco family and look forward to continuing the excellent service and products NOV and Wilson have to offer our customers.”
National Oilwell Varco is a worldwide leader in the design, manufacture and sale of equipment and components used in oil and gas drilling and production operations, the provision of oilfield services, and supply chain integration services to the upstream oil and gas industry.
Statements made in this press release that are forward-looking in nature are intended to be "forward looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934 and may involve risks and uncertainties. These statements may differ materially from actual future events or results. Readers are referred to documents filed by National Oilwell Varco with the Securities and Exchange Commission, including the Annual Report on Form 10-K, which identify significant risk factors which could cause actual results to differ from those contained in the forward looking statements.
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Crude Oil Traders Whisper....U.S. Inventories on the Rise
COT: August crude oil was slightly lower overnight as it consolidates below the 62% retracement level of the 2009-2012 rally crossing at 80.33. Stochastics and the RSI are oversold but remain neutral to bearish signaling that additional weakness is possible near term. If August extends this year's decline, the 75% retracement level of the 2009-2011 rally crossing at 73.28 is the next downside target. Closes above the 20 day moving average crossing at 82.86 are needed to confirm that a short term low has been posted. First resistance is the 20 day moving average crossing at 82.86. Second resistance is the reaction high crossing at 87.32. First support is last Friday's low crossing at 77.56. Second support is the 75% retracement level of the 2009-2011 rally crossing at 73.28.
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Tuesday, June 26, 2012
Strong Resistance at 80.33 Proving Difficult for the Crude Oil Bulls
Crude oil closed higher due to short covering on Tuesday as it consolidates below the 62% retracement level of the 2011-2012 rally crossing at 80.33. The high range close sets the stage for a steady to higher opening when Wednesday's night session begins. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term. If August extends this spring's decline, the 75% retracement level of the 2011-2012 rally crossing at 73.28 is the next downside target. Closes above the 20 day moving average crossing at 83.31 are needed to confirm that a low has been posted. First resistance is the 20 day moving average crossing at 83.31. Second resistance is the reaction high crossing at 87.32. First support is last Friday's low crossing at 77.56. Second support is the 75% retracement level of the 2011-2012 rally crossing at 73.28.
Natural gas closed higher on Tuesday as it extended this month's rally. The high range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are becoming overbought but remain bullish signaling that sideways to higher prices are possible near term. If July extends this month's rally, May's high crossing at 2.838 is the next upside target. Multiple closes below the 20 day moving average crossing at 2.449 are needed to confirm that a short term top has been posted. First resistance is today's high crossing at 2.778. Second resistance is May's high crossing at 2.838. First support is the 20 day moving average crossing at 2.449. Second support is this month's low crossing at 2.168.
Gold closed lower on Tuesday and poised to renew the decline off last week's high. The low range close sets the stage for a steady to lower opening when Wednesday's night session begins trading. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near term. If August extends last week's decline, May's low crossing at 1529.30 is the next downside target. Closes above the 10 day moving average crossing at 1602.60 are needed to temper the bearish outlook. First resistance is the 10 day moving average crossing at 1602.60. Second resistance is reaction high crossing at 1642.40. First support is the reaction low crossing at 1556.40. Second support is May's low crossing at 1529.30.
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Natural gas closed higher on Tuesday as it extended this month's rally. The high range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are becoming overbought but remain bullish signaling that sideways to higher prices are possible near term. If July extends this month's rally, May's high crossing at 2.838 is the next upside target. Multiple closes below the 20 day moving average crossing at 2.449 are needed to confirm that a short term top has been posted. First resistance is today's high crossing at 2.778. Second resistance is May's high crossing at 2.838. First support is the 20 day moving average crossing at 2.449. Second support is this month's low crossing at 2.168.
Gold closed lower on Tuesday and poised to renew the decline off last week's high. The low range close sets the stage for a steady to lower opening when Wednesday's night session begins trading. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near term. If August extends last week's decline, May's low crossing at 1529.30 is the next downside target. Closes above the 10 day moving average crossing at 1602.60 are needed to temper the bearish outlook. First resistance is the 10 day moving average crossing at 1602.60. Second resistance is reaction high crossing at 1642.40. First support is the reaction low crossing at 1556.40. Second support is May's low crossing at 1529.30.
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CME Recap Energy Market Report For Tuesday June 26th
August crude oil prices registered an inside day trading range that was slightly higher on the session. The market spent most of the session within a tight trading range, despite fractional improvement in outside market sentiment.
Early support for the market came from gains in Brent crude oil and from expectations that US weekly crude stocks drew down last week. Prices took a negative turn in the wake of US economic data that showed Consumer Confidence falling by more than expected in June.
Some traders pointed to gains in Brent crude oil and concerns over a workers' strike in Norway that could tighten up near term supply as a force providing a late morning turnaround. As a result, the price differential between Brent and WTI crude oil increased by nearly $2.00 on the session.
Expectations for this week's EIA crude oil report are for a draw in the range of 750,000 to 1.0 million barrels.
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Drop in U.S. Gasoline Prices Reflects Decline in Crude Oil Costs
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Since reaching a recent peak of $3.94 per gallon on April 2, the average retail price U.S. drivers paid for gasoline has fallen for 12 weeks in a row to $3.44 per gallon, according to EIA's weekly motor fuel survey. The drop in gasoline prices largely reflects the decline in crude oil prices (see chart below), which have historically comprised the biggest part of the pump price.
The national average price for regular unleaded gasoline fell 50 cents per gallon over the 12-week period, while the spot prices for West Texas Intermediate (WTI) crude oil declined the equivalent of 63 cents per gallon and Brent crude oil fell the equivalent of 81 cents per gallon. WTI and Brent are among the world's leading oil pricing benchmarks.
If crude oil price changes are fully passed through to consumers, for every $1 per barrel change in crude oil prices, consumers could expect to see a 2.4-cent-per-gallon change in retail gasoline prices. However, EIA analysis indicates that generally about 50% of the crude oil price change is usually passed on to consumers at the pump within two weeks, and 80% is generally passed on within four weeks. Gasoline prices are also sensitive to conditions affecting particular regional markets, such as significant refinery outages on the West Coast this spring that led to higher prices in that area.
The price of crude oil accounts for about two thirds of the retail price of gasoline. Refining costs, distribution and marketing costs, and state and federal taxes make up the rest of the retail gasoline price. Pump prices vary by region, with some drivers paying more or less for gasoline than the national average depending on where they live (see chart below).
Concerns that a weak global economy will lead to reduced petroleum demand has contributed to lower crude oil prices. However, part of the reason retail gasoline prices have not dropped as much as crude oil prices is that U.S. gasoline demand has started to show some growth in recent months. During the first quarter of 2012, monthly EIA data shows U.S. gasoline demand was down about 1.4% from the first quarter of last year. However, since the gasoline price peak, weekly EIA data indicate that gasoline demand has started to strengthen, with demand down only 0.9% in April compared to a year earlier and up by 0.2% in May.
The current 12 week drop in gasoline costs is the second longest period of declining pump prices recorded by EIA's weekly fuel price survey since the drop at the end of 2008, when pump prices fell for 15 straight weeks.
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Since reaching a recent peak of $3.94 per gallon on April 2, the average retail price U.S. drivers paid for gasoline has fallen for 12 weeks in a row to $3.44 per gallon, according to EIA's weekly motor fuel survey. The drop in gasoline prices largely reflects the decline in crude oil prices (see chart below), which have historically comprised the biggest part of the pump price.
The national average price for regular unleaded gasoline fell 50 cents per gallon over the 12-week period, while the spot prices for West Texas Intermediate (WTI) crude oil declined the equivalent of 63 cents per gallon and Brent crude oil fell the equivalent of 81 cents per gallon. WTI and Brent are among the world's leading oil pricing benchmarks.
If crude oil price changes are fully passed through to consumers, for every $1 per barrel change in crude oil prices, consumers could expect to see a 2.4-cent-per-gallon change in retail gasoline prices. However, EIA analysis indicates that generally about 50% of the crude oil price change is usually passed on to consumers at the pump within two weeks, and 80% is generally passed on within four weeks. Gasoline prices are also sensitive to conditions affecting particular regional markets, such as significant refinery outages on the West Coast this spring that led to higher prices in that area.
The price of crude oil accounts for about two thirds of the retail price of gasoline. Refining costs, distribution and marketing costs, and state and federal taxes make up the rest of the retail gasoline price. Pump prices vary by region, with some drivers paying more or less for gasoline than the national average depending on where they live (see chart below).
Concerns that a weak global economy will lead to reduced petroleum demand has contributed to lower crude oil prices. However, part of the reason retail gasoline prices have not dropped as much as crude oil prices is that U.S. gasoline demand has started to show some growth in recent months. During the first quarter of 2012, monthly EIA data shows U.S. gasoline demand was down about 1.4% from the first quarter of last year. However, since the gasoline price peak, weekly EIA data indicate that gasoline demand has started to strengthen, with demand down only 0.9% in April compared to a year earlier and up by 0.2% in May.
The current 12 week drop in gasoline costs is the second longest period of declining pump prices recorded by EIA's weekly fuel price survey since the drop at the end of 2008, when pump prices fell for 15 straight weeks.
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Is this technical support for oil or a lift on tensions in Syria?
CME: August crude oil prices took a slightly higher track during the initial morning hours, helped by a modest lift in outside market sentiment and expectations that week's EIA inventory report will show a draw. August Brent crude oil broke out to a new three day high during the initial morning hours, supported by a modest level of short covering, as well as expectations that US crude oil inventories drew down last week. The crude oil market also appears to be getting a modest lift from rising tensions in Syria. Meanwhile, the supply situation looks more than ample given soft economic data that continues to weigh on demand prospects and as Saudi Arabia continues their active production pace.
COT: August crude oil was slightly higher overnight as it consolidates some of this year's decline. Stochastics and the RSI are oversold but remain neutral to bearish signaling that additional weakness is possible near term. If August extends this year's decline, the 75% retracement level of the 2009-2011 rally crossing at 73.28 is the next downside target. Closes above the 20 day moving average crossing at 83.31 are needed to confirm that a short term low has been posted. First resistance is the 20 day moving average crossing at 83.31. Second resistance is the reaction high crossing at 87.32. First support is last Friday's low crossing at 77.56. Second support is the 75% retracement level of the 2009-2011 rally crossing at 73.28.
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Monday, June 25, 2012
Crude Oil Bears Supported by Lack of Confidence in European Debt Crisis and China Numbers
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Crude oil closed lower on Monday as it consolidates below the 62% retracement level of the 2011-2012 rally crossing at 80.33. The mid range close sets the stage for a steady opening when Tuesday's night session begins. Stochastics and the RSI are diverging but are neutral to bearish signaling that sideways to lower prices are possible near term. If August extends this spring's decline, the 75% retracement level of the 2011-2012 rally crossing at 73.28 is the next downside target. Closes above the 20 day moving average crossing at 83.91 are needed to confirm that a low has been posted. First resistance is the 20 day moving average crossing at 83.91. Second resistance is the reaction high crossing at 87.32. First support is last Friday's low crossing at 77.56. Second support is the 75% retracement level of the 2011-2012 rally crossing at 73.28.
Natural gas closed higher on Monday as it extended this month's rally. The low range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near term. If July extends this month's rally, May's high crossing at 2.838 is the next upside target. Multiple closes below the 20 day moving average crossing at 2.434 are needed to confirm that a short term top has been posted. First resistance is today's high crossing at 2.731. Second resistance is May's high crossing at 2.838. First support is the 20 day moving average crossing at 2.434. Second support is this month's low crossing at 2.168.
Gold closed higher due to short covering on Monday as it consolidates some of this month's decline. The high range close sets the stage for a steady to higher opening when Tuesday's night session begins trading. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near term. If August extends last week's decline, May's low crossing at 1529.30 is the next downside target. Closes above the 10 day moving average crossing at 1606.40 are needed to temper the bearish outlook. First resistance is the 10 day moving average crossing at 1606.40. Second resistance is reaction high crossing at 1642.40. First support is the reaction low crossing at 1556.40. Second support is May's low crossing at 1529.30.
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Crude oil closed lower on Monday as it consolidates below the 62% retracement level of the 2011-2012 rally crossing at 80.33. The mid range close sets the stage for a steady opening when Tuesday's night session begins. Stochastics and the RSI are diverging but are neutral to bearish signaling that sideways to lower prices are possible near term. If August extends this spring's decline, the 75% retracement level of the 2011-2012 rally crossing at 73.28 is the next downside target. Closes above the 20 day moving average crossing at 83.91 are needed to confirm that a low has been posted. First resistance is the 20 day moving average crossing at 83.91. Second resistance is the reaction high crossing at 87.32. First support is last Friday's low crossing at 77.56. Second support is the 75% retracement level of the 2011-2012 rally crossing at 73.28.
Natural gas closed higher on Monday as it extended this month's rally. The low range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near term. If July extends this month's rally, May's high crossing at 2.838 is the next upside target. Multiple closes below the 20 day moving average crossing at 2.434 are needed to confirm that a short term top has been posted. First resistance is today's high crossing at 2.731. Second resistance is May's high crossing at 2.838. First support is the 20 day moving average crossing at 2.434. Second support is this month's low crossing at 2.168.
Gold closed higher due to short covering on Monday as it consolidates some of this month's decline. The high range close sets the stage for a steady to higher opening when Tuesday's night session begins trading. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near term. If August extends last week's decline, May's low crossing at 1529.30 is the next downside target. Closes above the 10 day moving average crossing at 1606.40 are needed to temper the bearish outlook. First resistance is the 10 day moving average crossing at 1606.40. Second resistance is reaction high crossing at 1642.40. First support is the reaction low crossing at 1556.40. Second support is May's low crossing at 1529.30.
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